When rents are up a third in five years and a pint costs 6.55, a condominium in the Visayas starts to look interesting; Lowri Griffiths reads the small print
The Big Smoke on a Small Budget: North London Retirees Look at Cebu
When rents are up a third in five years and a pint costs 6.55, a condominium in the Visayas starts to look interesting; Lowri Griffiths reads the small print
By Lowri Griffiths, lifestyle and current affairs correspondent, North London
A Reasonable Daydream
London is expensive, and the figures say so. SpareRoom reports that Inner London room rents are up 37.4 percent since the second quarter of 2021, and thinkmoney reports that the average London pint is 6.55 pounds. It is not surprising that a retired couple in Enfield look at a warm country and a sea view and begin to calculate.
I do not know what it costs to live in Cebu and will not pretend to. I can tell you what I have learned about the property market there, because it has been in the news.
The News
Manila News reported that Cebu brokers blame a foreign scandal for slow condominium sales. Philippine authorities have been examining allegations about Thomas Markle Sr., who lived in Cebu until earlier this year, as GMA News and the Guardian have reported. The allegations are unproven and no charges have been filed. Child protection is a serious matter. The only joke I am prepared to make is about brochures.
The brokers say buyers have gone quiet. The London Prat has reported on one effect: British pensioners say they are being asked to produce two referees and a letter from the vicar, a story available at https://prat.uk/cebu-estate-agents-demand-character-references/.
The Fundamentals
The fundamentals are, on paper, reasonable. Colliers named the Visayas and Mindanao a key property investment hotspot in July. Under the Condominium Act foreigners may own condominium units but not land, with a cap of 40 percent of a project. The Philippine Retirement Authority sets out the retirement visa terms.
I mention these because a daydream needs a few facts under it. None of them is advice. A lawyer in the Philippines is the right person to read the documents.
Why Markets Panic
Tversky and Kahneman’s availability heuristic says that people judge how likely something is by how easily examples come to mind. A broker alone with three brochures and a cold coffee is an easy example. The units that sold last month are harder to picture.
That is as true in London as in Cebu. The vivid example, an empty pub, a closed shop, a shuttered showroom, outweighs the figures, which is why a column about the Big Smoke can be moved by a story from the Visayas.
What London Can Teach
A pub that closes every day, a pint at 6.55 and a room at 915 pounds are not signs of collapse. They are signs of costs rising faster than comfort. The reaction of a retiree who looks abroad is a rational one, and it should be done with the same care as any other purchase: read the contract, ask for references and visit more than once.
The sea did nothing wrong, as a vendor in the Cebu story is said to have remarked. Nor, to be fair, did Crouch End.
The Cost of Comfort
Staying put is not free either. A retiree in London pays for rent or maintenance, council tax, transport and the occasional 6.55 pint. A retiree abroad pays for a different set of things, including flights home, health insurance and the cost of being far from family. The comparison is only meaningful when every item is on the list.
My own view, for what a columnist’s view is worth, is that people who retire abroad successfully tend to be the ones who rented first, visited in every season and kept a route home.
A Light Note
The jokes in this column are about brochures, referees and the vicar. They are not about anyone’s legal difficulties, and I have no view on them. The allegations concerning Mr Markle are unproven, and the authorities in the Philippines will decide what, if anything, follows.
What I can say is that the market there is real, the paperwork is real and the cold coffee is, I am told, genuinely cold.
Questions to Ask
If you are considering a move, ask: what are the total costs including fees and taxes? Who manages the building? What happens to my visa if the rules change? Where will I get medical care? How will I get home? And what does my family think?
Then speak to someone who has done it, and to someone who tried and came back.
Mang Pedring, the guard in the Cebu story, reads the newspaper aloud in an empty lobby. If you are ever in that lobby, buy him a coffee. He knows the market.
Property Nerves, Seen From Elsewhere
Fear of a market travels fast. The same jitters turn up in the comic dispatches on the Cebu condominium story: a Manila News report on a Mactan broker with three brochures, a London Prat account of the references demanded of British retirees (direct link: https://prat.uk/cebu-estate-agents-demand-character-references/) and a Bohiney piece on two-hour open houses. Read them for the human detail a market report leaves out. The wider network is at prat.uk and bohiney.com.
Note: Philippine authorities are examining unproven allegations about Thomas Markle Sr., who lived in Cebu until earlier this year, as GMA News and the Guardian have reported. No charges have been filed. Child protection is a serious matter; the jokes here are about a property market.
For the lighter side of the news, there is always The Daily Mash.
SOURCE: https://bohiney.com/cebu-realtor-cant-sell-beachfront-listings/
